John Payne: Why Did the Soybean Complex Shine Monday, While Corn Made Contract Lows?

Soybeans and products were all higher on Monday, while corn continued to see technical selling and long liquidation ahead of first notice day on Friday.

Soybeans, meal and bean oil all ended to the plus side on Monday, while corn and most of the wheat complex made new contract lows.

John Payne, Advance Trading, says soybeans and the products were all adding weather premium with a hotter drier forecast to end August.

However, he thinks there was also value buying in the soybeans by processors who are looking at much improved crush margins.

“Soybean crush margins are good right now,” he says.

Corn could not follow the strength in soybean and instead was drug down by wheat.

Both September and December corn contracts made new contract lows.

Payne says, “I think a lot of it was forced liquidation ahead of first notice day on Friday on September contracts. Farmers are having to make the tough decision of whether to roll or sell ahead of delivery.”

Wheat also saw First Notice Day selling and long liquidation with all three classes making new contract lows early in the session.

Soft Red Winter wheat and Hard Red Spring wheat ended lower, while Hard Red Winter wheat managed to reverse and close higher on the day.

A strong U.S. dollar was also a headwind for wheat and corn on Monday.

AgWeb-Logo crop
Related Stories
Sam Hudson with Cornbelt Marketing says corn and soybeans were firmer on inflationary buying and optimism regarding the China summit. Cattle soared with higher cash.
Farmers in parts of the High Plains and Southeast need a break from relentless drought, while nationwide planting progress is outpacing the five-year average.
Jamie Gieseke with Paradigm Futures says commodities are starting to gain favor with the funds on inflation fears and that includes grains. A China deal could just add fuel to the fire.
Read Next
Fresh analysis from FAPRI finds passage of year-round E15 would bring limited near-term gains to corn prices, while SRE changes would put pressure on farm income and negatively impact soybeans.
Get News Daily
Get Market Alerts
Get News & Markets App